Flipping properties can be an immensely profitable line of business. Turn on any home or DIY network or browse social media platforms and you will find thousands of folks showcasing their home flips. While the business is equal parts satisfying and lucrative, it requires careful planning and a considerable amount of elbow grease.
If you are thinking about flipping a house as an investment strategy, make sure to follow these tips:
Do Your Due Diligence
As more big-shot players enter the picture and manage to cut down on delivery time and costs, the competition is nothing short of fierce. But even large corporations are prone to misjudging the housing market with Zillow being the latest company to halt its home-flipping business after reporting continued losses.
Be sure to do thorough research of every aspect of the process and the property you plan to flip. This includes ordering home inspections, assessing basic facts about the neighborhood, looking into the history of the home, understanding tax and zoning laws, speaking with an insurer about insurance costs, and staying on top of housing market trends.
Get Multiple Quotes
Don’t settle for the first contractor who claims they can do all the work. Getting multiple quotes from reputable contractors are key to keeping costs down and turning a profit. Additionally, when hiring contractors, it is important to check if the prospective company offers their workers proper liability and worker’s comp so you aren’t held responsible in the future for any alleged wrongdoings or accidents.
Plan for Unexpected Expenditures
No matter how meticulous you are in recording your expenses, there will be some that occur during the renovation that you cannot anticipate. By creating a budget that is too strict, you could be setting yourself up for failure. Make sure that your budget is flexible enough to allow for these unexpected expenses.
Decide on a Strategy
While many real estate investors will sell a house once it’s been renovated, some find that turning the property into a rental may yield more returns. Make sure to weigh your options and select one that aligns with your long-term goals.
Talk to a Professional
Education is a key factor in unlocking the benefits of home-flipping. With a specialty in residential investment property financing, Ridge Lending Group comes to you equipped with a vast portfolio of knowledge and experience suitable for all aspects of real -estate finance. RLG maintains a continued commitment to being the best resource it possibly can to its customers all while setting itself apart from other lenders as a leader in both education and technology within the lending industry.
The overarching goal of RLG is simple but powerful: to educate investors on the options that are best suited for their situation and help them achieve real estate investment success both now and in the future.
Are you interested in learning more about real estate investing? RLG would love to help you find a suitable investment strategy for your goals! Call us today to learn more!